A fire destroyed a warehouse of the Goren Group, Inc., on May 4, 2021. Accounting records on that date indicated the following:

Merchandise inventory, January 1, 2021	$	2,070,000
Purchases to date		5,970,000
Freight-in		570,000
Sales to date		9,900,000

The gross profit ratio has averaged 30% of sales for the past four years.

Required: Use the gross profit method to estimate the cost of the inventory destroyed in the fire.